re: finding intersection of supply/demand to calculate jobs lost by min wage
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If you can't exit the labor market, you have no control over your price (wage). So a vertical supply. Demand for wages now depends on game theory, how little can you offer before the slaves revolt?
This is the game of ultimatum- if the two parties can find a price they agree to to split the benefits, the deal happens. If not, everyone picks up the chess pieces and flings them at the other player. Econ theory says the optimal move is to offer 1cent on the dollar.
♡ 0 ↻ 0With real humans, the split in experiments is closer to 60/40. This is driven by politics and social mores, the supply & demand chart is irrelevant.
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